[November 21, 2011]MINNEAPOLIS (AP)
-- McDonald's and Target dropped one of the nation's largest egg suppliers after an animal rights group released an undercover video at the egg producer's farm in three states.

McDonald's Corp. said Friday it had dropped Sparboe Farms as a supplier after a video by the group Mercy for Animals showed cases of animal cruelty at five facilities in Iowa, Minnesota and Colorado. Target Corp. soon followed, saying it would pull eggs from the Litchfield, Minn.-based company off its shelves.

"Having been made aware of the unacceptable conditions in the company's egg laying facilities, effective immediately, Target will discontinue its business relationship with Sparboe Farms," Minneapolis-based Target said in a statement late Friday.

Sparboe produces 300 million eggs a year, in regular, liquid, frozen and dried form, and ships them to restaurants and stores across the country. The company's Vincent, Iowa, plant had billed itself as the sole fresh egg supplier to every McDonald's west of the Mississippi River.

McDonald's officials say Sparboe was a "significant" supplier and that it was unclear when, or if, the company would work with the Golden Arches again. Sparboe's Iowa facility produced 2 million eggs a day, seven days a week.

That changed Friday when images shot by Mercy for Animals showed a worker swinging a bird around by its feet, hens packed into cramped cages, male chicks being tossed into plastic bags to suffocate and workers cutting off the tips of chick's beaks.

"The behavior on tape is disturbing and completely unacceptable. McDonald's wants to assure our customers that we demand humane treatment of animals by our suppliers," Bob Langert, McDonald's vice president for sustainability, said in a statement.

The nation's largest retailer -- Bentonville, Ark.-based Wal-Mart Stores Inc.
-- also buys Sparboe eggs and has been demanding that suppliers treat their chickens humanely for years. Wal-Mart said it stopped working with Sparboe six weeks ago and that its decision had "nothing to do with animal welfare concerns," said Dianna Gee, a Wal-Mart spokeswoman. She declined to discuss why Sparboe was dropped, citing company policy.

McDonald's and other fast-food chains and grocery stores have been studying how chickens are caged and cared for in its egg farms. The Humane Society has persuaded several national food outlets, including Burger King, Costco Wholesale, Denny's and Wendy's/Arby's Group, to buy at least some of their eggs from producers that allow hens to roam.

McDonald's and Target's moves also followed a warning letter to Sparboe Farms dated Wednesday from the U.S. Food and Drug Administration that said inspectors found "serious violations" at five Sparboe facilities of federal regulations meant to prevent salmonella. The warning said eggs from those facilities "have been prepared, packed, or held under insanitary conditions whereby they may have become contaminated with filth, or whereby they may have been rendered injurious to health."

McDonald's eggs were safe because they were cooked thoroughly, and none of its operations will be affected by Sparboe, company spokeswoman Lisa McComb said Saturday. About 27 million Americans eat at McDonald's each day.

Sparboe Companies LLC said Saturday it would create a task force to review the company's food safety and animal care.

Beth Sparboe Schnell, Sparboe Farms' president and owner, said the company was "shocked and deeply disturbed" by the video and that an internal investigation identified four employees "who were complicit in this disturbing activity." They were fired this month.

She also reassured customers that there is "absolutely no food safety concern or any recall of any Sparboe Farms products. Sparboe Farms egg and egg products are safe to eat."

Sparboe also said it has made management changes, taken corrective actions sought by the FDA, and begun retraining all barn workers in proper animal care procedures.

McDonald's said the suspension of its business dealings with Sparboe was not temporary but refused to say that it would never work with Sparboe again.

"We're not going to turn around in a month and work with them again," McComb said. "But we would never say never."

In the case of one U.S. fishery that did not use "sustainable methods" in its farming, McDonald's ended its business relationship for eight years before the company "completely turned around its practices," McComb said.

Sparboe describes itself as the fifth-largest shell egg producer and marketer in the United States, operating seven processing plants supported by 33 egg-laying and pullet production sites in Iowa, Minnesota and Colorado. The company says it serves retail, wholesale and foodservice customers in 26 states.

Sparboe spokesman Lyle Orwig said Friday the company has a "zero tolerance policy" for any animal abuse or cruelty. He said all employees are trained by a veterinarian and work with a crew leader who also has been trained.

"If he (the crew leader) sees anything, he would automatically correct it if he sees someone doing something wrong," Orwig said.

Oak Brook, Ill.-based McDonald's said the "most alarming actions on video" didn't happen at Sparboe's facility in Vincent, Iowa, which supplied its restaurants, but they violated the standards the company sets for its suppliers. McDonald's also insisted the food it serves is safe.

McDonald's said it got Sparboe eggs via Cargill Inc., which said it was suspending Sparboe as a supplier.

"We will not tolerate mistreatment of animals anywhere in our supply chain," Chris Roberts, president of Cargill Kitchen Solutions, said in a statement. He also said the issues the FDA raised "warrant additional review by Cargill."

Tim Loesch, a spokesman for Wayzata-based Cargill, declined to say how many eggs Sparboe supplied it or how much the company was paid. Orwig said it was too soon to tell what effect the loss of McDonald's business would be.

"Right now our focus is making sure that we are compliant with everything and get to the bottom of how it could have happened," Orwig said.

Mercy for Animals isn't satisfied with McDonald's decision to stop accepting eggs from Sparboe, said Matt Rice, the group's director of operations.

"These are company-wide, policy-level abuses," Rice said. "There's a culture of cruelty and neglect at McDonald and its suppliers."

McDonald's said it is participating in a three-year study that compares traditional versus cage-free hen housing systems, but Rice said the company continues to get most of its eggs from hens in battery cages that hold a lot of birds in cramped conditions.

"McDonald's is simply sidestepping the issue now. It's time McDonald's requires all of its suppliers to un-cage hens and finally give these animals the basic freedom to spread their wings, to walk and engage in other natural behaviors," he said, noting that McDonald's has already switched to cage-free eggs in Europe.

Mercy for Animals conducted its investigation from May 23 to Aug. 1, Rice said. The group got its people hired at the farms and sent them in wired with hidden cameras, he said. They "documented daily abuses that would shock and horrify most Americans yet are largely considered standard and acceptable to the egg industry," he added.

Orwig, the Sparboe spokesman, said the undercover taping was troubling because company employees sign a code of conduct that they will report any abuses immediately to a supervisor. In this case, he said, there were no reports.